Sharp Increase in Nankang’s Winter Sales Furthers Expansion
Following a strong 2005 winter season in some of Europe’s largest markets, Taiwanese manufacturer, Nankang has announced that it is extending is product range and broadening the distribution of the company’s Sonar second brand.
Nankang’s Sonar brand was previously only sold in Taiwan. But when the company recently increased capacity to 10 million units per year, it began looking abroad for distribution opportunities for these tyres. For the same reasons, outside of Taiwan Nankang is only planning to bring Sonar into what it sees as major markets.
Now the current production total of 10 million tyres per year, a capacity figure that has risen 40 per cent in the last two years is set to rise again. An additional production line is due to be completed in 2007, bringing production capacity to 14 million units per year.
Nankang describes Europe as its number one market, closely followed by North America; then Japan and Australia. According to Nankang’s Andy Lee, Germany leads Europe in terms of Nankang sales followed by the UK, Spain, France and Italy. Tyres & Accessories learnt that Nankang exports between 37 and 39 per cent of its production into Europe. As a result the manufacturer reports that plans for offices in the US and/or the EU are under consideration.
In terms of volume, roughly 1 million units find their way into Germany with a further 750,000 being sold in the UK. In the UK Nankang tyres are distributed by Unity Tyres, United Tyre and Kirkby Tyres. Looking further afield, Turkey and Russia are seen as the best two new markets as far as Nankang are concerned.
Numerous new sizes are on their way to customers, Andy Lee explained in an interview with Tyres & Accessories. These will include an asymmetrically designed SUV tyre, due to come market in the next seven months, and a 4×4 tyre. Furthermore the company is aiming to produce a 26-inch diameter product by the end of the year, which will be initially sold on the Taiwanese market.
One recent success for Nankang has been the sharp increase in its winter tyre sales. By the end of 2005 Nankang’s European winter tyre sales had grown to 10 times the size they were in 2003. The target then became 500,000 units for 2006. The historically high target is set against previous records of 80,000 tyres in 2004 and 40,000 units in 2003.
According to the company, this growth was made mainly due to the continuing efforts it has made to develop its business in the major markets. Not to mention the introduction of new pattern designs – the SV-1 and SW-5 being examples that are intended to appeal to a broad range of customers. Nankang is also said to be the first company in Taiwan to supply both stud-less and studable snow tyres for different weather conditions across the whole of Europe.
In Germany summer versus winter tyre sales work out as roughly 70:30, making the cold weather side of the business increasingly significant to the company across some of the largest markets. The UK is the exception to the rule as company executives explained that so far virtually no Nankang cold weather products have been sold in the UK.